Sam Bankman-Fried Loses Bid to Overturn Crypto Fraud Conviction
In a significant legal setback, Sam Bankman-Fried, the founder of the collapsed cryptocurrency exchange FTX, has lost his attempt to overturn his fraud conviction and 25-year prison sentence. The decision was handed down unanimously by a three-judge panel from the U.S. Court of Appeals for the Second Circuit in Manhattan on June 12, 2026. ### Court Upholds Conviction
The appellate court found the prosecution’s evidence against Bankman-Fried to be "robust," emphasizing that while he publicly assured customers, investors, and regulators that FTX customer funds were secure, he was simultaneously misusing those funds. Circuit Judge Barrington Parker, writing on behalf of the panel, highlighted that Bankman-Fried had spent customer money on personal real estate, political contributions, and various investments, effectively treating FTX as his "personal piggy bank."
Bankman-Fried’s defense team had argued on appeal that the trial judge improperly excluded evidence supporting his belief that FTX had enough funds to cover customer withdrawals. However, the appeals court rejected this argument, citing legal precedent that fraud occurs the moment a defendant deceives others into entrusting them with money or property, regardless of any intention to repay later. Judge Parker wrote, “FTX customers were defrauded as soon as Bankman-Fried transferred their money to Alameda regardless of how strongly he believed he might later return the money.”
Background of the Case
Before the dramatic fall of FTX in 2022, Bankman-Fried was a prominent figure in the cryptocurrency world and a multibillionaire. At his 2023 trial in Manhattan, he was convicted of seven felony charges including fraud and conspiracy. Prosecutors charged that he stole approximately $8 billion from FTX customers to cover losses at his crypto hedge fund Alameda Research, calling the scheme a “fraud of epic proportions.”
Bankman-Fried maintained his innocence regarding theft, admitting to operational mistakes but denying that he deliberately stole customers’ funds. However, his former deputies pleaded guilty and testified against him during the trial, further strengthening the prosecution’s case.
Sentencing and Current Status
At a sentencing hearing in March 2024, U.S. District Judge Lewis Kaplan noted that Bankman-Fried was aware his conduct was wrong but had made a grave miscalculation regarding the risk of being caught. Bankman-Fried was sentenced to 25 years in federal prison and is currently serving his sentence in a low-security federal prison near Santa Barbara, California, with an earliest possible release date in 2044. ### Possible Next Steps
Though the conviction stands for now, Bankman-Fried’s legal team may seek a rehearing by the full panel of active judges in the Second Circuit or petition the U.S. Supreme Court to review the case.
Additionally, Bankman-Fried is reportedly seeking a pardon from former President Donald Trump, as indicated by the Justice Department’s Office of the Pardon Attorney. Requests for comment from both the White House and the Justice Department have not been returned.
Conclusion
The appellate court’s ruling marks a crucial moment in the ongoing fallout from one of the largest failures in crypto history, reinforcing the legal repercussions of the FTX collapse and affirming the accountability of its founder, Sam Bankman-Fried, for the alleged misuse of billions of dollars in customer funds.